Friday, May 12, 2017

The challenges—and the unexpected benefits—of
collaboration among community development financial institutions (CDFIs) were the
subject of a recent gathering in Cincinnati that focused on the experiences of CDFIs
that have received funding from the Partnerships for Raising Opportunities in
Neighborhoods (PRO Neighborhoods)
program, a five-year, $125 million competitive initiative funded by JPMorgan
Chase.

Kicking off the event, Karen Keogh, Head of Global
Philanthropy at JPMorgan Chase, welcomed civic and non-profit
leaders, along with the directors of the award-winning CDFIs to a renovated union hall in
Cincinnati’s Over-the-Rhine neighborhood, commenting that the neighborhood, which
many of the attendees had a personal hand in revitalizing, was “like Brooklyn,
but cooler.” In her remarks, Keogh described JPMorgan Chase’s philanthropic efforts, focused on
workforce readiness, small business growth, consumer financial health, and
supporting communities and neighborhoods. Part of this last area of focus, the PRO Neighborhoods initiative
encourages CDFIs to take on specific community development challenges.

At the event, Alexander von Hoffman, a Joint Center
Senior Research Fellow who is examining the initiative’s methods and achievements,
and Colleen Briggs, Executive Director of Community Innovation at JPMorgan
Chase, discussed findings of the Joint Center’s research on the work of the PRO
Neighborhoods recipients. Dr. von Hoffman noted that, according to a Progress Report
released last fall, the entities funded by the first seven PRO Neighborhood
awards have made $240 million in loans and leveraged another $350 million in
additional funding. This funding has
helped create 2,400 jobs and produced or preserved 1,600 units of affordable
housing.

These efforts, von Hoffman said, spanned
a wide array of programs, partnerships, and places. They ranged from groups like ROC USA, which took its model of helping the residents of manufactured
houses purchase their mobile-home parks into new states, to collaborations between diverse programs in specific areas, such as PRO Oakland,
which makes loans to small businesses, nonprofit groups, and low-income housing
developers along International Boulevard and in downtown Oakland, California. Carrying out complex collaborations in
diverse locales, von Hoffman explained, has taught the PRO
Neighborhoods group leaders that to succeed they must be flexible, sensitive to
markets, and communicate regularly with their partners.

Successful partnerships require strong relationships, added Jeanne Golliher and Joe Neri, the CEOs of Cincinnati Development Fund (CDF) and IFF, two CDFIs that were part of the Midwest Nonprofit Lenders Alliance (MNLA), one of seven entities funded in 2014 via a pilot program that became the PRO Neighborhoods initiative. They explained that MNLA, which is the subject of a recent Joint Center case study, brought together CDF’s local knowledge and IFF’s underwriting expertise to provide long-term facility loans to nonprofits in the Cincinnati and Dayton, Ohio, metro areas. (These included several projects in the Over-the-Rhine neighborhood.) Recounting the “courtship” that led to the CDF and IFF collaboration, Neri and Golliher described how clear communication and commitment to shared values and social goals turned “love at first sight” into a strong and fruitful “marriage.” Neri, for example, noted that Golliher’s passion for the people of Cincinnati ultimately led IFF to provide funding for a homeless shelter that was outside their organizations’ planned collaboration.

In formal and informal discussions at the event, leaders
of other entities that have been funded by the PRO Neighborhoods program echoed
Golliher and Neri’s remarks. Several participants noted that getting on the
same page and hashing out details at the beginning of a collaboration can easily
take a full year. This means that potential
partners must be patient and probably should build “ramp-up” time into their plans.
Extending the relationship metaphor that Neri and Golliher had used, several people also cautioned against “shotgun marriages” between
CDFIs who come together only to secure funding from grants. While such
partnerships may initially seem like a good idea, poorly thought out
collaborations often end in heartbreak, they warned. On the other hand, some participants noted,
well-thought out collaborations often go beyond their original scope and foster
a sense of commonality and common purpose that led to better engagement with local
officials and civic leaders.

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